Core Insights - The easy yield in the crypto market has diminished, with Flowdesk attributing this change to structural factors rather than cyclical ones [1][2] Group 1: Yield Compression - Yields across staking, stablecoin lending, and bitcoin-backed credit have compressed, not due to low demand but because of deepening liquidity and tightening arbitrage [2] - ETH staking yields have stabilized around 2.5%, significantly lower than the double-digit yields seen in previous cycles, despite total value locked (TVL) approaching $30 billion [3] Group 2: Stablecoin Lending Dynamics - USDC borrowing demand reached all-time highs in 2025, but an influx of supply kept rates low, balancing heavy demand with abundant liquidity [4] - Derivatives markets reflect similar trends, with perpetual funding rates remaining stable and futures basis spreads compressed as traders preferred delta-neutral strategies [5] Group 3: Bitcoin-Backed Lending - The liquidity profile of Bitcoin and its collateral quality have attracted new lenders, including traditional finance firms, transforming the lending landscape into a standardized business [6] - As competition for borrowers increased, margins narrowed, loan-to-value ratios tightened, and excess returns diminished, indicating a shift towards a more mature financial system [6] Group 4: Future Opportunities - With traditional yield products becoming crowded and efficient, Flowdesk suggests that the next investment opportunities will arise from complex financial products, such as bespoke credit and hybrid on and offchain structures [8]